The old Motorola plant in Harvard once was going to be an indoor water park, a college or Navistar’s HQ. New plan: A solar-powered data center.
A white elephant factory and a former premier corporate campus are targets for ambitious redevelopment plans outside of Chicago — one faces many obstacles to getting started while the other is well underway.
The white elephant is Motorola’s former 1.5 million-square-foot cellphone plant in rural Harvard. The campus is Motorola’s old headquarters in Schaumburg, which is being demolished to make way for an entertainment, office and housing complex.
The Schaumburg development already features new offices, apartments and attractions, with more under construction. The Harvard site, by contrast, is a gargantuan fixer-upper, far from cities and expressways, and locked in a complex legal battle. Its prospective buyers are optimistic they can turn it into a solar-powered data center — but residents in the McHenry County town have had their hopes for the property dashed for nearly 20 years.
The properties reflect the challenges created by a recent spate of large sites in suburbs ripe for redevelopment during a time of changing demands. The COVID-19 pandemic not only caused an economic downturn, but created a glut of office space, made worse in the northwest suburbs, where the gigantic former AT&T property already was vacated.
Despite this difficult environment, Jacob Bak, CEO of Green Data Center Real Estate in Vancouver, said his firm is working with Solar Alliance of Knoxville, Tennessee, to build a 56-megawatt solar array in Harvard that would power a data center for corporate and cloud computing.
The site will require extensive renovation. The city of Harvard cited the building for many safety code violations, foremost among them the broken fire sprinkler system, which officials expect will cost millions of dollars to fix. Bak said his team can handle it — if they get financial incentives they are seeking from Illinois.
State officials have had preliminary discussions with the company regarding potential economic development incentives, said Lauren Huffman, a spokeswoman for Gov. J.B. Pritzker’s office.
Illinois exempts qualifying data centers from state and local sales tax on equipment, such as for cooling, heating, servers and storage. To qualify, a data center must invest at least $250 million and provide at least 20 full-time jobs.
“We want that building to breathe life into the community,” Bak said. “We’re fully committed to it. We have an amazing business plan if all the pieces fall into place, so we’re hoping the state steps up.”
One handicap of the site has been its remote location, nearly a two-hour drive from Chicago and far from any expressway. But with an existing fiber optic connection, the center could offer services to downtown Chicago at a fraction of the land cost in the Loop, Bak said.
Because data centers use a lot of electricity, Bak also plans for natural gas generators on site for backup power. Green Data will start with 400,000 square feet, and hope to lease the rest.
Motorola opened the plant in 1997, when the company was the world’s No. 1 maker of cellphones, with a $35 million investment from the state.
The building featured palatial offices, an auditorium and two heliports, and employed 5,000 people. But after the company fell on hard times, losing the market in the switch from analog to digital phones, among other things, it closed the plant in 2003.
In 2008, the facility was acquired for $17 million by Optima International, which failed to maintain the property, allowing pipes to burst and causing extensive water damage and mold. Optima turned out to be part of a network of investments associated with Ukrainian oligarch Ihor Kolomoisky, whom federal prosecutors recently charged with laundering embezzled money by buying such properties around the world.
In 2016, the property was sold for $9 million to Xiao Hua “Edward” Gong, a Chinese-Canadian businessman. He later was charged in Canada with fraud and money laundering. At the request of Canadian prosecutors, a federal judge froze the sale of the property, and it was placed under control of the U.S. Marshals Service.
Gong reportedly maintained that evidence gathered by Chinese authorities in the case was coerced. The Ministry of the Attorney General in Ontario told the Tribune all charges against Gong were withdrawn in February — but did not immediately explain what that means for the disposition of the property.
Those involved said a court resolution of the property’s proposed sale is hoped for by July.
Local residents are hopeful, but somewhat skeptical. Past proposals for the property included an indoor water park, a college and a Navistar headquarters. All fell through, and the property’s lawn, left uncut, grew wild.
“It just sat there like a big sore thumb,” Mayor Michael Kelly said.
Harvard, with a population of 9,500, has some amenities that other small towns don’t, like a Metra train station, a hospital and a small private airport, but retains a rural feel. A fiberglass statue of Harmilda the dairy cow stands on guard in the heart of town, and its annual Milk Days festival is scheduled to return in October.
“It’s not the suburbs, it’s a small town feel,” Kelly said. “You can go to the store and see dozens of people you know, and there’s something nice about that.”
On a website for former Motorola employees, many said it was the best company for which they’d worked. But others called the site, which only operated for about six years, a symbol of managerial incompetence, at a time when Motorola was losing its position in the industry.
“From the time they built it, it was a white elephant in the middle of nowhere,” said former employee Robert Law. “It was gorgeous and they spared no expense. But they didn’t take into account that cheaper foreign labor would be the wave of the future.”
As for the proposed data center, Law said, “That would be fantastic — but I’m not gonna hold my breath.”
In Schaumburg, by contrast, with the help of $32 million in tax-increment financing, redevelopment of the 300-acre former Motorola property has been underway since UrbanStreet Group acquired the property in 2016. Motorola Solutions still operates from an office tower there, while other former office buildings have been demolished for new projects.
Zurich North America built its insurance headquarters next door, Topgolf opened a deluxe driving range with a restaurant and bar, and The Boler Co., a manufacturing firm, opened its headquarters in the first of three planned eight-story office buildings.
Last year, 260 apartment units opened, and row homes are under construction. Plans also call for a central common area featuring restaurants and retail with apartments above, and a 12-acre park with recreational areas, a garden and a concert stage, with a nearby pedestrian bridge over Interstate 90. In March, a bar, restaurant and entertainment concept leased 20,000 square feet in the sprawling redevelopment.
Following a trend that has seen corporate offices move to Chicago to attract young workers, Harvard and Schaumburg are not alone when it comes to having large holes to fill. Plans call for apartments and town houses at the former AT&T headquarters in Hoffman Estates, where the Sears headquarters is also looking for new tenants. Arlington International Racecourse and its 326 acres are for sale for mixed-use development.
Schaumburg Economic Development Director Matt Frank cautioned that the former Motorola headquarters — about the size of Chicago’s Loop — may take 15 to 20 years to build out.
“This is a once-in-a-lifetime opportunity,” he said, “so we need to be selective.”
